p.1 

OAR Box 1787 

Prepped by Ollie Stewart 

Document Number: 

16) II-B-1 

Docket Number: 

A-90-37 

Printed 11/4/200810:22:18 AM Sheet 16 of 147 
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A-^o-3 7 

^•i- " - . ' TT-B-.-I 

UNITED STATES ENVIRGfcMENTAL PROTECTION AGENCY 

REGION V 

D^TE: FEB 14199 2 

SUBJECT: New Source Review/Prevention of Significant Deterioration Policies 

FRCM: David Kee, Director 

Air and Radiation Division 

Region V (A-18J) 

TO: John Calcagni, Director 

Air Quality Management Division 

Office of Air Quality Planning and Standards (MD-15) 

John B. Rasnic, Director 

Stationary Source Compliance Division 

Office of Air Quality Planning and Standards (EN-341W) 

Due to our recent experience with USS/Kobe Steel Company of Lorain, Ohio, I 

strongly reccmmend that the policies that the Agency depends upon to implement 

the New Source Review (NSR)/Prevention of Significant Deterioration (PSD) 

program be subject to notice and comment to provide a stronger basis for 

possible enforcement action. In particular, special attention should be given 

to the policy on limiting the potential to emit (June 13, 1989) since so many 

sources try to avoid major source review by limiting their potential to emit. 

In general, I believe that principles fundamental to the NSR program should, 

whenever possible, be incorporated into regulations and not left as policies. 

I believe that this action would greatly improve the effectiveness and 

integrity of the NSR program. Now might be a good time to consider additional 

regulations since your offices are currently working on revisions to the 

NSR/PSD regulations in order to meet new statutory requirements. 
P.3 

EPA's Proposed Air Permit Regulations: 

The Challenge To Achieve 

A Workable Program 

Comments Of The 

Clean Air Implementation Project 

July 9,1991 
P.4 

CLEAN AIR IMPLEMENTATION PROJECT 

The Clean Air Implementation Project is an organization of major industrial corporations 

which have joined together this year to focus on a selected group of issues under the 1990 Qean 

Air Act Amendments. The issues to be addressed by the Project cut across industry lines and 

thus will generally affect each of the members in a similar fashion. In particular, heavy emphasis 

will be placed on permitting and enforcement issues. 

All of the Project members have facilities subject to EPA's Title V Operating Permit Program. 

The Project is committed to working with EPA to develop regulations to implement the Title V 

program that fully comply with the requirements of the 1990 Amendments. These regulations 

will inevitably impose substantial burdens on EPA, state agencies and industry alike — but the 

greatest impacts will be imposed on American industry. 

Listed below are the members of the Project and representatives from each member company 

who are playing a major role in the Project's activities. The law firm of Morgan, Lewis & Bockius 

serves as counsel to the Project, with John Quarles and Bill Lewis leading this effort. 

MEMBERS AND THEIR REPRESENTATIVES 

Air Products and Chemicals, Inc. 

Todd Solodar 

Allied-Signal Inc. 

Paul Arbesman 

James E. Cooper 

BASF Corporation 

Douglas Martin 

Bethlehem Steel Corporation 

David E. Tomlinson 

Thomas W. Easterly 

Conoco, Inc. 

William McClain 

Digital Equipment Corporation 

Robert Donnelly 

Polly T. Strife 

The Dow Chemical Company 

R. Dean Cooper 

John M. DeMeester 

E.I. du Pont de Nemours & Co., Inc. 

Steven A. Coppola 

Tom Kittelman 

Eastman Chemical Company 

Vivian M. Mclntire 

Joe Davis 

Exxon Company, U.S.A. 

Brent D. Patterson 

General Electric Company 

Larry Boggs 

IBM Corporation 

Earl M. Wunderli 

Timothy M. Mann 

Kaiser Aluminum 

& Chemical Corporation 

Joe D. Flaherty 

Phillip H. Fournet 

Merck & Co., Inc. 

Robert W. Hyde 

Bruce Wallington 

Monsanto Company 

Brent J. Gilhousen 

Olin Corporation 

Arthur D. Rheingold 

Danny Henderson 

Owens-Illinois, Inc. 

A. Walt Long 

Robert Towles 

Pfizer Inc 

William Huhn 

Carol A. Casazza 

The Procter & Gamble Company 

David E. Ross 

Reynolds Metals Company 

James E. McKinnon 

Renata M. Manzo 

Rhone-Poulenc Inc. 

Regina A. Murray 

Schering-Plough Corporation 

Frank J. Chut 

Sun Refining 

& Marketing Company 

Thomas S. Stammel 

William J. Donohue 

Texaco Inc. 

Thomas K. Reilly 

Union Carbide Chemicals 

and Plastics Company Inc. 

Carol L. Dudnick 

Joseph C. Hovious 

United Technologies Corporation 

John Szwast 

Mark Citroni 
P.5 

BEFORE THE 

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

COMMENTS OF THE 

CLEAN AIR IMPLEMENTATION PROJECT 

ON 

EPA's Proposed Rule 

For The Establishment Of 

The Title V Operating Permit Program 

Under The Clean Air Act Amendments Of 1990 

Operating Permit Program 

(40 C.F.R. Part 70) 

56 Fed. Reg. 21,712-781 

May 10,1991 

July 9,1991 

Docket No. A-90-33 

Counsel: 

John Quarles 

William H. Lewis, Jr. 

Morgan, Lewis & Bockius 

1800 M Street, N.W. 

Washington, D.C. 20036 

(202) 467-7145 
P.6 

EPA ROUNDTABLE PROCESS 

The members of the Clean Air Implementation Project wish to commend EPA for its 

organization of the Permits Roundtable to provide input for the staff's consideration in 

preparing and revising drafts of the permit regulations. The Roundtable process was a 

highly constructive undertaking which we hope EPA will use often in developing other 

clean air regulations. As a result of EPA's interest in hearing ideas from all affected parties 

on how best to devise a workable set of permit regulations, we believe that the regulations 

that the Agency has proposed provide a good foundation for the new state operating 

permit programs, although important changes still are necessary to improve the program's 

workability. 

THE COMMON GOAL 

"Industry, environmentalists, regulatory agencies, and the general public all 

share the same goal for the air permit program. Everyone has a stake in assuring 

its success. Motivations may differ as to why that goal is important. Some may be 

concerned solely to achieve the contribution the permit program can make to 

improve air quality. Others may be more influenced by a concern that bottlenecks 

in permit issuance will disrupt our national economy. Whatever the motivation, 

however, the bottom line is the same. If the permit program runs smoothly, 

everyone wins. If the lines back up and the permits don't get issued, everyone loses. 

The universal goal is to make it succeed." Excerpt from Comments, p.17 
P.7 

Table Of Contents 

Page 

Executive Summary 1 

Recommendations 7 

I- Introduction 13 

A. The Need To Obtain Permits, or Permit Revisions, Will Create New Hurdles 

Restricting Economic Growth arid Flexibility 13 

B. The Permit Requirements, However Streamlined, Will Impose Massive 

Paperwork Burdens on Industry and Regulatory Agencies Alike 14 

C The Federal Air Permit Program Presents A Different Case from The 

NPDES Water Permit Program 15 

D. EPA Must Simplify The Air Permit Requirements To Increase Prospects 

That The Program Will Be A Success 17 

E. EPA Should Authorize Continuation of Existing State Permit Programs, Except 

Where Elements of The Title V Program Are Essential 18 

II- Specific Comments 21 

A. The Title V Permit Regulations Must Be Structured To Assure Plants' 

Operational Flexibility 21 

1. EPA Miigt* RpquJi^States To Write PermitsThat Anticipate Necessary .^-—N 

Changes and To Recognize That Unprohibited Changes Are Authorized (23 J 

2. The Proposed Regulations Must Require That States Carry OutThe Flexible -/"""X 

Source Operation Provisions of Section 502(b)(10) on A Facility-Wide Basis ( 25 ] 

3. The "Minor Permit Amendment" Authorization Is An Essential Element of The Proposed Regulations 27 

a. Providing An Expedited Process To Make Minor Changes Fully Comports 

With The Requirements of Title V and Relevant Legislative History 27 

b. The "Fast Track" Permit Revision Authority Provided For under The Minor 

Permit Amendment Provision Is Critical For Industry To Be Able To Respond to Marketplace Demands 28 

c. It Is of Utmost Importance For EPA Not To Restrict The Minor Permit 

Amendment Authority More Than It Already Has under The Proposed 

Regulations 30 
P.8 

Table Of Contents (Cont'd) 

4. The Procedures For Immediately Accomplishing Administrative Permit 

Amendments Should Be Clarified 31 

5. Significant Parts of The Provisions That Relate to "Permit Modifications" 

Should Be Changed or Clarified 31 

a. EPA Should Clarify What Constitutes A "Modification under Title I" 32 

b. The 18-Month Review Period for Permit Modifications Should Be 

Reduced Significantly 32 

c. Changes in Reporting Requirements and Compliance Milestones Should Be Treated as 

Minor Permit Amendments 35 

d. The Definition of Stationary Source in The Proposed Regulations Should Be The Same as 

in The Title I Regulations 35 

6. A Program Submission Element Should Be Added Requiring States To Describe 

Fully How They Intend To Provide for OperationaTFlexibility as Required by The Act 

and Part 70 36 

7. Aspects of The Recordkeeping Requirements Should Be Clarified To Obviate 

Unintended Potential Consequences 36 

B. EPA Should Provide for Renewal Applications To Be Submitted Six Months Prior to 

Permit Expirations 36 

C. The Permit Regidations Should Authorize Permitting Agencies To Issue Permits That 

Include Requirements Which Are Different from, but Equivalent in Stringency to, SIP 

Requirements 37 

D. The Permit Shield Protection in The Proposed Regulations Should Be Broadened /. 

in A Number of Respects 39 

1. Permit Shield Protection Should Be Afforded under All Circumstances after The 

Issuance of A Title V Permit 39 

2. EPA's Proposal Should Be Revised To Authorize Permit Shield Protection after The 

Permit Term Has Expired 40 

E. The Regulatory Definitions That Provide The Basis For Determining Which 

Plants Are Covered by The Permitting Requirements Are Too Expansive 40 
P.9 

Table Of Contents (Cont'd) 

1. EPA Should Provide For Only Rggulated-Ein^sions Units To Be Considered Ln 

Determining Whether A Plant Meets The "Major Source" Emissions Thresholds 40 

2. EPA Should Incorporate A Mechanism That Will Assure That Plants Can Base The 

Major Source Determination upon Actual Emissions Rather Than Their "Potential 

To Emit" 41 

F. EPA Should Specify The Parts of The Title V Permit Program That Are Derived 

from The NPDES Program and Make Clear in The Final Preamble That 

Interpretations of The Title V Program Are Only To Be Based Upon The NPDES 

Program Where Specifically Indicated 42 

G. The Proposed Provisions Aimed At Giving Plants Acting In Good Faith Assurances 

That They Will Receive The Protections Gained By Submitting A Complete 

Application, as well as Those Establishing The "Application Shield," Are Essential 

to The Success of The Title V Program .*. 43 

H. EPA's Proposal That State Requirements More Stringent Than Those Required under 

The Act Will Not Be Federally Enforceable Represents A Good Balancing of Federal 

and State Interests 44 

I. States Should Be Directed To Base Their Permit Fees on Actual Emissions as Proposed, 

but The Preamble Goes Far Beyond What Is Authorized under Title V In Delineating 

The Proper Uses of Permit Fees 45 

J. The Proposed Regulations Should Be Changed To Make It Clear That Private 

Contractors Cannot Be Used as Inspectors under The Act 46 

K. EPA Should Clarify The Compliance Plan Requirements and Should Not Include A 

Provision Requiring Operations and Maintenance Plans for Sources Currently 

Meeting The Act's Requirements 47 

L. The Preamble and Proposed Regulations Should Be Revised To Provide That 

Only Test Methods and Monitoring Already Required Are To Be Incorporated in 

Title V Permits and To Reduce Substantially The Information Plants Are Required 

To Report 48 

M. EPA Should Specifically Authorize States' Inclusion of Exemptions for Upset, 

Start-up and Shut-down Conditions 49 

N. The Final Regidations Should Give States The Discretion To Exempt Modifications 

Having Insignificant Air Quality Implications from The Title V Requirements 50 
P.10 

Table Of Contents (Cont'd) 

Appendix A Need for Operational Flexibility Through The Writing of 

Flexible Permits 53 

Appendix B Demonstration of The Critical Need for The "Minor Permit Amendment" 

Authorization in The Proposed Regulations 54 

Appendix C Demonstration That EPA's Proposed Authorization of An 18-Month Period 

For Processing Permit Modifications Is Much Too Long 57 

vi